State GRAs: A Low-Cost, Secure Solution to America's Retirement Crisis

September 1, 2012

Instead of contracting out the insurance of the minimum guarantee on investments to a private insurance company, the state could back the guarantee.

The share of workers without any retirement plan at work has risen dramatically over the past decade. We propose states offer all workers a voluntary, low-fee, low-risk, State Guaranteed Retirement Account (State GRA) to help boost savings for retirement. State GRAs are individual accounts where benefits at retirement are based solely on contributions and returns. The major features of the State GRA proposal include consistent contributions, pooled investments, guaranteed returns, portable accounts, lifelong retirement income, independent administration, and public investment management.

Authors: Teresa Ghilarducci, Robert Hiltonsmith and Lauren Schmitz
Download PDF